It might not feel like it, but so far the national recession of 2008 has left Maryland relatively unscathed. As tough as times are in housing, stores, publishing and finance, this state has avoided the blunt trauma visited upon many regions and the nation as a whole.
The next six months will be key in determining whether this is as bad as it gets or whether we'll sink into the kind of mud not seen since the early 1990s.
If housing prices slow their descent, if multibillion-dollar bond wipeouts diminish, if commercial real estate stays out of the soup, if stocks continue recovering, if nationwide job losses reverse, then Maryland should avoid the worst.
But we need the national economy to stabilize, and we need it now.
"We think the rebound is going to be in about 2010," says Daraius Irani, director of applied economics at RESI, Towson University's research wing. "Given what's going on with the retail market, the housing market and energy costs, most economists are predicting a worse second half [of 2008] than what we are experiencing now."
Most signs aren't encouraging. Sales tax collections, which give a vivid, timely look at what's going on at Home Depot, Wal-Mart and the rest, show Maryland retail sales declined in April, May and June. "Really in the tank" is the technical term employed by state revenue estimates czar David Roose to describe what's going on.
Since consumers are more than two-thirds of the economy, sales-tax weakness bespeaks broad problems that, so far, aren't showing up in Maryland's job-growth results.
Income-tax collections, too, are arriving "under expectations" this year, according to a letter Comptroller Peter Franchot sent to the legislature last month. Tax shortfalls mean Gov. Martin O'Malley and the General Assembly will face very tough budget decisions in January.
Maryland car dealers are having their worst year since the 1990s.
New-car sales for June fell 16 percent, compared with the same month last year, reflecting a pattern that has been in place for months. Drivers are forsaking luxury and buying value. The average purchase price of $23,759 for June was the lowest for any month since 2002, according to figures from the Motor Vehicle Administration.
While housing is holding up better than in other states, it is still going downhill. Prices are falling. Tens of thousands of Marylanders are behind on mortgages. Even if no new "For Sale" signs appeared in metro Baltimore, it would take until next summer to sell all the houses on the market, according to Metropolitan Regional Information Systems.
So far, Baltimore's battered financial employers have avoided a repeat of the late 1980s and early 1990s, when poison loans sent important local companies into receivership or the arms of out-of-town competitors.
But the pressure is on. Regional bank stocks trade for a third or a fifth of what they fetched a year or so ago. Another severe blow for Legg Mason, which has been hammered by debt write-downs and poorly performing stock funds, and Baltimore's premier financial employer is going to start looking like takeover bait.
The weak dollar, which propelled U.S. exports to a record in June, has not stopped Maryland manufacturers from continuing to shed jobs.
What's the good news? Factories, housing, retailing and finance are even worse in many parts of the country. The Labor Department reports Maryland employers as a whole have not only continued to add jobs but are hiring at nearly twice the rate they did last year. (Irani predicts slight job growth for all of 2008 and negligible expansion next year.)
The nation as a whole, by contrast, has shed jobs seven months in a row.
Credit Baltimore's booming health care industry and continued growth of defense and homeland security employers, which compensated for weakness in finance, real estate and retail.
But they can't do it forever. At some point Maryland's economy will revert to its historical course of more or less paralleling the country's. Fans of Maryland prosperity should root for "most economists" to be wrong about predictions of a continued national slowdown.